Precious metals have become popular investment options, especially since the recession of 2008. However, when you set out to buy gold online, you will want to know how the market works and what to look out for. First and foremost, always buy from a reputable dealer. You might find a seemingly great deal on an online auction site, but you know what they say about something that seems too good to be true: it probably is. Besides having a good idea of who it is you are dealing with when purchasing precious metals, there are a few more things to keep in mind before you commit.
Assaying Is an Important Step
When you decide to buy gold online, remember that just about anyone can melt metal and stamp it to say anything he or she chooses. Although gold bullion is usually marked in some way, the only way to tell for sure whether or not it is genuine and contains the amount of gold it should is to have it professionally assayed. Counterfeiters have been known to sell hollowed-out gold bars, as well as some that are alloyed with other, undeclared metals. Therefore, it is important to have your physical gold tested and certified by a qualified professional. Should you ever decide to sell your bullion, the person interested in buying gold online may request that this process be repeated.
Buying Gold Is an Excellent Way to Diversify Your Investment Portfolio
The gold market seems to fluctuate in its own way, apart from the stock market and other commodities. In some cases, it may behave in the complete opposite way of other markets, rising in value when they fall and falling when they rise. Therefore, buying gold is an excellent way of ensuring that you are not keeping all of your proverbial eggs in one basket. When you invest in a wide array of stocks, bonds and commodities, your chance of losing everything in a single market change is reduced. This is one of the main reasons many people decide to buy gold online.
Coins May Be More Practical Than Bars
Should you buy gold bullion in the form of bars or coins? When faced with this decision, keep in mind that a standard-sized gold bar weighs 400 troy ounces and may be worth hundreds of thousands of dollars. If you are in a position to purchase physical gold in this quantity, and you wish to store it for a long time, buying bars may be the way to go. On the other hand, if you wish to split up your investment at a later date, such as by leaving an inheritance to your children and grandchildren, you may wish to buy gold online in smaller quantities. For this, bullion coins are the perfect solution.
Gold bullion coins are not as close to pure, 24 karat gold as their bar-shaped counterparts are. This is because coins, being relatively small and likely to be stored together, need to withstand a certain amount of wear and tear. Therefore, gold coins are usually made of gold alloyed with other, stronger metals to give them extra strength and durability. This standard practice does not lower their value compared with other forms of bullion because the amount of gold contained in a coin is assessed based on a standard percentage of the coin’s total weight. When you buy gold online, you are charged according to the gold weight, not the total weight, of the coin.
Storage Options Affect Security and Overall Costs
When you buy gold coins or gold bars, finding secure storage will most likely be at the top of your list of next steps. When you start looking for storage for physical gold, security is probably your most important consideration. Think in terms of physical security against unauthorized access as well as potential costs in the form of monthly fees, insurance, vault administration and handling of deliveries and shipments. In some cases, you may want to store your precious metals on your own property. In other cases, depending on the volume of bullion you own, you may consider storing it yourself in a safe deposit box inside a bank vault. However and wherever you decide to securely store your investment, be sure to purchase a relevant insurance policy.
Exchange Traded Commodities and Gold Certificates Are Not the Same as Physical Gold
Before you commit to buy gold online, be sure you understand what is being offered for sale and how it relates to other gold-buying options you may have. Physical gold is generally considered to be a solid, long-term investment, but you may also be offered exchange traded commodities and paper gold. ETCs can be reliable in some cases, but in others, they may not be backed by gold at all. Gold certificates, often referred to as paper gold, are supposed to confer ownership of physical gold in the vault of the issuing bank. However, these certificates may not guarantee that you can collect your corresponding physical gold in the event that the bank faces financial difficulties. On the other hand, when you buy gold online yourself and then store it in a safe deposit box in the same bank vault, that gold belongs to you and the bank has no right to remove it from your private box. In fact, the bank has no right to know what you keep in your safe deposit box at all.
As you can see, investing in gold is a straightforward process. Once you decide to make a purchase, watching the trading value of gold go up and down each day may not give you much of an advantage in the long run. With all of the options out there, and the sheer number of precious metal dealers urging you to buy gold online, the process can get confusing. However, with a trusted professional, like the ones at Regal Assets, to guide the way, you can be confident in your ability to make an educated decision when choosing to buy gold coins or larger forms of bullion. You can even roll over your existing IRA to a gold-backed plan. Whatever you approach you decide to take, seek out a trusted advisor, then make a plan and execute it.